VZCZCXRO3824
RR RUEHROV
DE RUEHAE #0240/01 1230952
ZNR UUUUU ZZH
R 020952Z MAY 08
FM AMEMBASSY ASMARA
TO RUEHC/SECSTATE WASHDC 9638
INFO RUCNIAD/IGAD COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 0037
RUEAIIA/CIA WASHDC
RHEHNSC/NSC WASHDC

UNCLAS SECTION 01 OF 02 ASMARA 000240 
 
SIPDIS 
 
SIPDIS 
SENSITIVE 
 
LONDON AND PARIS FOR AFRICA WATCHERS 
DEPT FOR AF/E 
 
E.O. 12958:  N/A 
TAGS: PGOV ECON EFIN EMIN PREL ER
SUBJECT: RESPONSE:  CHINA'S ENGAGEMENT IN ERITREA 
 
REF:  A) STATE 41697, B) 07 ASMARA 931 
 
--------------------------------------- 
¶1.  (SBU) CHINESE ENGAGEMENT IN ERITREA 
--------------------------------------- 
 
The relationship between the Government of China (GOC) and the 
Government of the State of Eritrea (GSE) is strong.  President 
Isaias visited President Hu during the China-Africa Summit in 
November 2006.  During a January 2007 visit to Eritrea, Foreign 
Minister Li Zhaoxing partially cancelled Eritrea's bilateral debt 
and announced Eritrean exports to China were tariff-free.  China has 
no known direct investments in either Eritrea's budding mining 
sector or its pending free trade zone in Massawa.  The GOC 
reportedly has provided military weapons and equipment to the GSE. 
 
GOC assistance to the GSE is provided mostly through exchange 
programs and concessionary loans.  China provided the GSE a 100 
million Yuan ($14 million) loan to upgrade telecommunications 
infrastructure and another 350 million Yuan ($50 million) to 
renovate the defunct cement factory in Massawa.  There are reports 
that China provided a $100 million loan to assist the GSE's purchase 
of a 30% stake in the Bisha mining project (gold and other 
minerals), of which $75 million reportedly remains to be dispersed. 
 
Eritrea sent more than 80 GSE officials and technicians to China in 
2007 for GOC-funded seminars and training sessions lasting from 1 to 
3 months.  The Commercial Section of the Chinese Embassy recently 
hosted an annual program alumni reception that drew approximately 
175 guests. 
 
In 2008 and 2009, China will send a number of exchange visitors to 
Eritrea.  For the sixth consecutive year, China sent 18 doctors to 
provide medical care and training to Eritrean physicians, as well as 
six maintenance support professionals to (Chinese-built) Orotta 
Hospital to repair and upgrade medical equipment.  Three senior and 
seven junior agricultural experts will assist the GSE's pursuit of 
food security.  Three female sports coaches will train Eritrea's 
female athletes. 
 
The GOC will also build a College of Social Sciences in the city of 
Adi Quala and primary schools in the cities of Ghinda and 
Mendeferra. 
 
--------------------------------------------- 
¶2.  (SBU) CURRENT LEVEL OF ENGAGEMENT BETWEEN 
CHINESE AND U.S. MISSIONS IN ERITREA 
--------------------------------------------- 
 
U.S.-Eritrean relations are poor, which the GSE attributes to U.S. 
failure to force Ethiopia to abide by the 2002 border demarcation 
decision of the Eritrean-Ethiopian Boundary Commission (EEBC).  The 
Chinese maintain one of the best bilateral relationships of any 
diplomatic Mission in Eritrea, because they refuse to engage 
substantively in regional policy issues such as the contested border 
or address human rights abuses, in their pursuit of economic 
objectives. 
 
An August 2007 special advertising supplement in Business Week 
contained numerous specific calls from top-level GSE leaders, 
including the President and Minister of Finance, to Chinese 
businesses to invest in Eritrea.  Ruling People's Front for 
Democracy and Justice (PFDJ) Head of Economic Affairs Hagos 
Ghebrehiwet, Eritrea's economic czar, welcomed Chinese business 
because there are "no . . . conditions and almost no strings 
attached.  China is here, it has the interest, it wants to make 
money, and it is helping us develop while it does so."  The 
supplement was an obvious attempt by the GSE to wean itself from 
Western assistance by attracting investors from countries less 
concerned with the many local human rights abuses. 
 
These efforts have paid off for China to some extent politically as 
well.  For example, the GSE-run media published an editorial on 
April 5 regarding the recent crackdown on protestors in Tibet, 
"condemning the violence and vandalism perpetrated by the rioters 
and the attempts to manipulate the unfortunate crisis" and 
commending "the civilized manner with which the Government of the 
People's Republic of China handled the situation to restore order." 
 
The disparate state of bilateral relations experienced by the 
Chinese and American missions significantly diminishes the number of 
opportunities for bilateral cooperation.  While the U.S. Embassy 
maintains cordial social relations with our Chinese counterparts, 
particularly given Asmara's small diplomatic corps, the Chinese have 
been generally unwilling to upset its economic relationship by 
joining with the U.S. or other Missions in pressing Eritrea for 
 
ASMARA 00000240  002 OF 002 
 
 
constructive engagement internationally or addressing its internal 
governance problems. 
 
Both the U.S. and Chinese missions send representatives to the 
bi-monthly donors' forum, at which areas of common interest are 
discussed.  Embassy officers meet regularly with Chinese commercial 
and Embassy counterparts in either formal or informal venues and 
maintain limited information exchange on activities in-country. 
 
------------------------------------------ 
¶3.  (SBU) AREAS BENEFITING FROM INCREASED 
BILATERAL COOPERATION AND COORDINATION 
------------------------------------------ 
 
The GSE has consistently demonstrated its unwillingness to engage 
with countries like the U.S. and like-minded European nations, which 
have been critical of the regime's internal and regional policies. 
The government has proven more amenable towards working through/with 
multilateral fora (for example, UN assistance organizations and the 
European Commission (EC)), and with countries, such as China which 
pursue a purely economic strategy.  Given China's influence with the 
ruling regime and its role on the UN Security Council, the GOC could 
potentially serve as a mediator with the GSE, although Post is 
doubtful that China would find such a role in its interest. 
 
One area of possible cooperation lies in people-to-people medical 
diplomacy.  The U.S.-based Physicians for Peace, a privately funded 
group of American doctors providing medical assistance and training 
to Eritrean medical professionals, may be willing to coordinate with 
local Chinese medical professionals in providing medical training. 
The USG could seek to support such an initiative through needed 
equipment and supplies.  Another possible area for cooperation is 
cultural diplomacy.  Last fall, the U.S. Embassy approached the 
Chinese Embassy about possibly hosting a U.S.-Chinese musical duo, a 
proposal which did not pan out at the time, but could be revisited 
in the future.  The U.S. Embassy has been unable to obtain visas for 
official visitors, including speakers and entertainers, for several 
years and has difficulty in securing GSE permits for public 
diplomacy events.  The Chinese Embassy experiences less problems in 
gaining GSE approvals for their cultural events and visitors, 
however, the Chinese Embassy noted that the program which we 
proposed was beyond its budget. Given the extraordinarily 
restrictive environment in Eritrea, "soft diplomacy" issues could 
provide one of the few openings to pave the way for greater 
cooperation between the U.S. and China on shared issues of interest 
in Eritrea. 
MCMULLEN